You are here

Asian countries battle IP ‘maximalism’ in leaked TPP chapter

The leaked IP chapter from TPP proves consumers were right to be concerned

Smaller countries pushing consumer-friendlier alternatives to extreme proposals from US

Digital Consumers by Dr Jeremy Malcolm

THE leak of a recent version of the intellectual property (IP) chapter of the Trans-Pacific Partnership (TPP) Agreement has sparked much outrage over the maximalist copyright and patent policies that the US Government, in particular, is seeking to impose on countries around the world.

These rules would limit the ways that consumers can use digital products, and allow copyright owners to meddle with our access to the Internet, whilst jacking up the prices of IP-intensive goods such as books and medicines.

This public outrage is further justified by the secretive and undemocratic process for negotiation of the deal. There remains a good case that the TPP, as a whole, ought to be rejected regardless of its content unless there is a radical improvement in the transparency and accountability of the negotiation process.

But whilst these two points are well understood and the main US proposals have been well covered, what many commentators have missed is that most of the other countries negotiating the agreement are pushing back against these proposals with much more balanced rules, some of which are actually good for consumers.

At the end of the day, there are powerful commercial and political forces behind the TPP, and significant stakes beyond just intellectual property, which might just push the agreement over the line.

If that happens, we need to pay a lot more attention to the good (or at least, the less bad) proposals in the IP chapter of the TPP, and to support those as a fall-back position to the rejection of the whole deal.

In this article I will take a look at some of the key provisions that other countries are proposing, and how they differ from those proposed by the United States.

(The treatment given here is not exhaustive, and in particular, I won't be looking at all at issues relating to access to medicines, which have been well covered elsewhere.)

Notably, the strongest opponent of the US position from amongst the countries of the Asia Pacific region happens to be Malaysia, closely followed by Vietnam.

The developed countries of New Zealand, Brunei and Singapore fall somewhere in the middle, whilst Japan and especially Australia are more likely to side with the United States, on issues where the United States has any allies at all.

Outside of the region, Chile is the consumer's closest ally, followed by Canada and Peru, with Mexico and of course the United States itself the least favourable.

General provisions

Although often overlooked in favour of more substantive parts of the chapter, the IP chapter opens with a number of general provisions that illustrate this pattern very well.

The first example comes from the objectives section of the draft agreement, in which a full nine other countries are aligned against the United States in proposing that the parties to the TPP ought to “maintain a balance between the rights of intellectual property holders and the legitimate interests of users and the community in subject matter protected by intellectual property.”

A smaller list of countries – Malaysia, Singapore, Vietnam, Chile, New Zealand and Canada – propose that ‘transfer of technology’ also be recognised as an objective.

Although this has become a term of art, the concept is simple enough: It refers to a range of measures (such as foreign direct investment, licensing and joint ventures) that developed countries are obliged to offer developing countries to improve their technological capacity, as a quid pro quo for their adoption of IP rules that otherwise offer them little immediate benefit.

The TRIPS Agreement (the leading global IP treaty, to which we will return) makes this link explicit, so why shouldn't the TPP?

This is another important balance against intellectual property maximalism. Research published by Consumers International last year showed how countries can use a similar provision on IP abuse contained in the TRIPS Agreement to justify not only competition laws, but also strong consumer protection laws that regulate the abusive practices of IP rights holders.

A slightly different grouping of countries – Malaysia, Vietnam, Brunei, Chile, Peru and New Zealand – also emphasise the importance of upholding the flexibilities of other international instruments in protecting access to knowledge.

This is an extremely interesting inclusion, given that the phrase ‘access to knowledge’ (which is another term of art, implying equitable public access to copyrightable works) does not actually appear in TRIPS or the other instruments listed.

Trademarks and patents

In the sections on trademarks and patents, there are only two provisions worthy of particular mention for their impact on the Internet and digital products or services.

The first of these deals with domain names on the Internet, and introduces yet another term not before seen in any international agreement – an ugly one at that, “cyber-piracy;” which is meant to indicate the infringement of trademarks by their use in domain names.

A global arbitration system for domain names, called the UDRP (Uniform Dispute Resolution Policy) already exists to resolve such trademark disputes for generic domains at the top-level (such as .com). The TPP would require all country-code domain operators (such as .my) to offer an equivalent arbitration system.

This proposal flies in the face of widespread criticism of the UDRP for being systemically biased against domain name owners, in favour of businesses with trademark claims. This could limit the use of trademarks as the domain names for non-profit commentary or criticism websites run by fans or aggrieved consumers.

The section on patents contains an interesting provision proposed by Mexico that would explicitly allow countries to exclude computer software “as such” from the classes of patentable subject matter. This year, New Zealand bravely abolished software patents, which have been a thorn in the side of US-based technology companies that have found them an impediment rather than an impetus to innovation.

Whilst abolising software patents was a good move for consumers, who can expect more innovative, lower-cost software coming from New Zealand in the coming years, it was also quite a risk to take while the TPP remains under negotiation, since the final agreement could potentially require that move to be reversed.

It is also curious that New Zealand is not shown as supporting the Mexican proposal that would remove this risk by making an express exception for the patentability of software.

Copyright

Moving on to copyright, a very critical question concerns exhaustion of rights – yet another term of art which refers to whether the copyright holder loses the right to control resale of copies of a work once it has been sold anywhere in the world, or only once they have authorised sale in their own country or region.

Malaysia, Singapore, Vietnam, Brunei, New Zealand, Peru, Chile and Mexico propose that the parties should be encouraged to apply the former rule, which in practice would allow parallel importation of copyright works, to allow consumers access to lower-priced imports of copyright works.

Additionally, Australia and Japan join in opposition to a later provision that would explicitly prohibit parallel importation of copyright works.

In combination, the end result is that the United States stands alone in its opposition to parallel importation – a position that stands at odds with its own Supreme Court's decision this year that parallel importation of textbooks from overseas into the United States is legal.

Another important mechanism for promoting access to knowledge for consumers is support for the public domain – that is, for the free use of copyright works whose term of copyright protection has expired, or been waived.

On this point, Chile and Vietnam (and in part Peru) have taken the lead in proposing a new provision that would require parties to identify subject matter that has fallen into the public domain within their respective jurisdictions, as well as to promote access and to preserve the public domain.

As there is no existing intellectual property treaty that deals with this important topic, it is a shame that this innovative provision does not yet seem to have more support.

Perhaps the single greatest threat that the TPP poses to the Internet is the proposal that it should provide that copyright extends to temporary reproductions.

Because such ephemeral copies in computer memory and storage are integral to the way that digital communications work, if it had ever been necessary for them to be licensed from the copyright owners of the works being stored or transmitted, the Internet could never have been developed to begin with.

As such it is surprising that only Vietnam, Canada and New Zealand have opposed the express recognition of temporary reproductions as copyrightable works. Additionally Chile, Malaysia, Brunei and Japan would require that such reproductions, even if otherwise covered by copyright, could be exempted by exceptions and limitations in national law.

Even so, this leaves five countries that seem to assume that it is unnecessary either to include either safeguard in the TPP. Frighteningly, this could leave the door wide open for an opportunistic copyright holder to claim exclusive rights over the temporary copies that our networks and devices make automatically as we use the Internet.

Finally in this section comes the very critical issue of the copyright term, which the TRIPS Agreement sets at a minimum of 50 years from the death of the author or from publication.

Disgracefully, Australia, Peru, Singapore and Chile all support a TRIPS+ term extending 70 years past the death of the author – and Mexico is proposing life plus 100 years! Only Malaysia, Vietnam, Brunei, New Zealand, and Canada would maintain the existing TRIPS term – which for many types of copyright work, such as software, is already far too lengthy.

For copyright works that are not produced by natural persons, the story is as bad or worse. The United States seeks a 95-year copyright term after the date of publication of such works, whilst Australia, Peru, Singapore and Chile propose 70, and Mexico 75 years.

For unpublished works, the United States proposes 120 years from the date of creation, and the other four countries mentioned above propose 70 years.

An alternative much simpler approach proposed by Malaysia, Vietnam, Brunei, New Zealand and Canada (but opposed by the United States, Australia, Singapore and Mexico) concisely provides that, “The term of protection of a work, performance or phonogram shall be determined according to each Party's domestic law and the international agreements to which each Party is a party.”